How is your financial health? Answer a few simple questions to find out where you stand in investment, insurance, loans
A regular salary does not always mean your finances are healthy. Insurance, savings, debt and retirement planning also matter. SEBI’s own Financial Health Check quiz helps you review these areas.
We are sharing the outcomes for different situations so you can compare your habits. Answer honestly to understand what looks good. Identify where you may need to make some practical changes.
Q: Does someone depend on your income?
A: The quiz begins by asking whether anyone depends on you financially. It then checks if you have life insurance cover of 15 to 20 times your annual income. Having this cover receives approval.
Otherwise, it recommends term insurance, naming dependents as nominees. Those with sufficient wealth may select “not applicable” if such cover seems unnecessary.
Q: Do you have health insurance?
A: Without insurance, the quiz recommends buying personal cover. Its suggested minimum is ₹5 lakh or half your annual income, whichever is higher. With only employer insurance, it suggests considering personal cover at the same level.
Existing personal policyholders can consider a super top-up for additional protection. Both personal and employer coverage receive approval, as does government health insurance.
Q: Do you understand your health policy?
A: Knowing its terms helps with cashless treatment and reimbursement claims. Knowing only the basics means you should read further. If unfamiliar, read the policy carefully to understand claim conditions.
Q: Can you manage unexpected expenses?
A: If not, build accessible emergency savings covering at least 6 months of expenses. The quiz suggests a separate savings account for immediate access.
If you manage only small emergencies, target 6-12 months of expenses. Confidence in handling emergencies receives a positive response.
Q: Do you pay credit card bills fully and punctually?
A: Paying fully before each due date receives approval. Occasionally falling short brings advice to reduce spending. Frequent shortfalls prompt stronger advice: return the card and seek professional debt guidance.
The quiz warns of an annual interest rate of around 40% on outstanding dues. Actual charges depend on your card’s terms.
Q: Do you have personal or unsecured loans?
A: Having none receives approval. Otherwise, the quiz recommends clearing these loans quickly because their interest rates are high.
Q: Do EMIs exceed 40% of your monthly take-home pay?
A: If yes, reduce debt and consider refinancing. Lower repayments encourage keeping debt low. Having no debt brings advice to invest towards retirement and financial independence.
Q: Do you follow a budget?
A: If yes, continue controlling spending. Otherwise, set monthly limits for needs and wants, keeping optional spending within limits.
Q: Have you planned and invested for retirement?
A: Use SEBI’s financial goal planner to calculate or check your required savings. Adequate investing receives approval. If behind, start planning and investing with discipline.
Q: Does your family know your investments?
A: Sharing details helps when you cannot manage money yourself. If already shared, consider adding a registered investment adviser’s contact details.
Q: Have you added nominees and prepared a will?
A: Add missing nominations and inform nominees. The quiz also recommends making a will. Where possible, keep nominees aligned with the people named to inherit your assets.
